Searching for strength
1 min read
Two features and one news item in this issue (May 2011) serve to underline how, with increasing competition from Asia, western firms can play to their strengths, exploiting lower cost countries to leverage their own businesses, either as suppliers or, for some, as customers.
First, 26-employee subcontract forging firm Shakespeare has teemed up with an Indian partner – to be more specific, it is now owned by the Indian company – with both playing to their strengths in the UK market.
The UK company was being pressured hard by automotive firms to reduce costs. Indeed, a £2 million contract was in jeopardy. But one of the firm's directors – one of three behind the buyout of the bankrupt company in 2002, in fact – saw potential in linking up with a low-cost firm to serve the automotive sector. Without the Indian connection, the company would not have survived.
Moreover, the new owner has even supported a required move to a new, larger site for the UK end of the operation, something that could have been an excuse to close, it is suggested.
With an initial business approach thwarted, the two facilities now both quote to companies, with the customer deciding the best route in any circumstance. Typically, the UK site focuses on niche, low volume, short (8-week) lead time parts, while India takes care of high volumes, longer (18-week) lead time forgings.
At High Wycombe, rapid prototyping/manufacturing and mould tool maker CRDM, which employs some 42 people, has worked with Chinese toolmakers in support of the delivery of a high-tech medical device for a UK firm (page 10). The project is hailed as a "milestone" and one that the organisation will, no doubt, seek to replicate.
Moving to mainland Europe, and Machinery recently attended a GF AgieCharmilles international Open House event in Germany (page 27). Here, the Swiss headquartered machine tool maker highlighted its high end technology, but, equally importantly, how its customers were employing it to differentiate service for particular markets.
GF AgieCharmilles itself was able to underscore that its technology could be found in most of the factories in the Far East producing LED (light emitting diode) technology, due to the precision requirement. It sold over 170 machines into companies producing LEDs last year, in fact.
As for its customers, these were variously serving high technology niches and gave credence to the machine tool firm's CEO's claim that, with China claiming mass production pre-eminence, "in Europe, we are generating new business opportunities".
Asian competition has changed the face of western manufacturing, but it is not merely a competitor; it is also partner, customer and catalyst. And change continues, of course.
First published in Machinery, May 2011
